Correlation Between PT Bank and Nintendo
Can any of the company-specific risk be diversified away by investing in both PT Bank and Nintendo at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining PT Bank and Nintendo into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PT Bank Central and Nintendo Co, you can compare the effects of market volatilities on PT Bank and Nintendo and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in PT Bank with a short position of Nintendo. Check out your portfolio center. Please also check ongoing floating volatility patterns of PT Bank and Nintendo.
Diversification Opportunities for PT Bank and Nintendo
Very good diversification
The 3 months correlation between BZG2 and Nintendo is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding PT Bank Central and Nintendo Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nintendo and PT Bank is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on PT Bank Central are associated (or correlated) with Nintendo. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nintendo has no effect on the direction of PT Bank i.e., PT Bank and Nintendo go up and down completely randomly.
Pair Corralation between PT Bank and Nintendo
Assuming the 90 days trading horizon PT Bank is expected to generate 1.19 times less return on investment than Nintendo. In addition to that, PT Bank is 2.02 times more volatile than Nintendo Co. It trades about 0.02 of its total potential returns per unit of risk. Nintendo Co is currently generating about 0.05 per unit of volatility. If you would invest 3,942 in Nintendo Co on October 24, 2024 and sell it today you would earn a total of 1,858 from holding Nintendo Co or generate 47.13% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 99.8% |
| Values | Daily Returns |
PT Bank Central vs. Nintendo Co
Performance |
| Timeline |
| PT Bank Central |
| Nintendo |
PT Bank and Nintendo Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PT Bank and Nintendo
The main advantage of trading using opposite PT Bank and Nintendo positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PT Bank position performs unexpectedly, Nintendo can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Nintendo will offset losses from the drop in Nintendo's long position.| PT Bank vs. UNIQA INSURANCE GR | PT Bank vs. OAKTRSPECLENDNEW | PT Bank vs. Coor Service Management | PT Bank vs. Platinum Investment Management |
| Nintendo vs. Zijin Mining Group | Nintendo vs. Harmony Gold Mining | Nintendo vs. SENECA FOODS A | Nintendo vs. Monument Mining Limited |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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